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The world is facing another major economic recession on the heels of the one caused by the COVID-19 pandemic in 2020. This time, it’s the result of Russia’s invasion of Ukraine and the series of economic sanctions imposed on the aggressor, which have disrupted global trade and financial systems. Given the size of the Russian economy, the sanctions and the country’s isolation will hurt not only Russia, but much of the rest of the world too.
We think it would be futile for Indonesia, as this year’s president of the Group of 20, to try to keep the war off the agenda. It can try, but the impacts of Russia’s invasion are bound to haunt discussions of global health, a sustainable energy transition and digital transformation, the three areas that Indonesia has prioritized.
The government has been making elaborate preparations to try to ensure the success of its G20 chairmanship and win national prestige. To make its stamp on the group, the country is looking for deliverables during its leadership, which will peak with a summit in Bali scheduled for October.
Much of the plan to support the 2022 motto “recover together, recover stronger” was made last year, and many of its assumptions about the global economy have now proven incorrect. We are entering an uncertain time, but a recession is a near certainty.
Rather than keeping doggedly to its agenda, Indonesia should be flexible and even prepare to change course in leading the G20. Rather than ignoring the issue, Indonesia should make the war in Ukraine a main part of the agenda. And rather than waiting passively for events to unfold, Indonesia should take an active role in the search for peace.
The country faces pressure from some G20 members to expel Russia or exclude it from all the group’s activities. Some say they will boycott the October summit in Bali if Russian President Vladimir Putin is invited. Bowing to these demands, however, could lead other members, like China and India, to reconsider their own participation.
This is a test of Indonesia’s global leadership. Rather than bowing to these pressures, Indonesia should use the presidency to play an active role in mediating peace between Russia and Ukraine and to ease the tensions between Russia and the United States.
Some House of Representatives members have called on President Joko “Jokowi” Widodo to use the G20 as a platform to launch peace initiatives. Senior cabinet members, however, have rejected the idea, saying the G20 was set up as a forum primarily for strengthening the global economic system. But given the current situation, the turmoil in the global financial and trade systems cannot be fixed without ending the war first.
The G20 cannot skirt the conflict and its impact on the global economy. Indonesia should make Ukraine a central part of discussions at the forum and should not exclude or expel anyone – at this stage. Instead, Indonesia must bring everyone together to sit down and resolve their differences.
Many countries are already offering to help mediate discussions between the parties in conflict. It is not certain that the Ukraine war can be resolved in such a way, but the G20 presidency puts Jokowi in a strong position to make an attempt.
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